Zambia v Meer Care and Others
| Jurisdiction | England & Wales |
| Judge | SIR ANTHONY CLARKE MR,LORD JUSTICE MAY,LORD JUSTICE JACOB,LORD JUSTICE SEDLEY,LORD JUSTICE LLOYD,LORD JUSTICE LAWS,Lord Justice Lloyd,Lord Justice Hoope |
| Judgment Date | 09 July 2008 |
| Neutral Citation | [2008] EWCA Civ 1007,[2006] EWCA Civ 1191,[2006] EWCA Civ 390,[2008] EWCA Civ 754,[2007] EWCA Civ 1415,[2007] EWCA Civ 1414 |
| Docket Number | B6/2006/1280,A3/2005/2357, A3/2005/2357/A,Case No: A3 2007/2189 and 2192,A3/07/1166; A3/07/1175; A3/07/1361,A3/07/2189; A3/07/2192 |
| Court | Court of Appeal (Civil Division) |
| Date | 09 July 2008 |
[2006] EWCA Civ 1191
Lord Justice Sedley
B6/2006/1280
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE CHANCERY DIVISION (MR JUSTICE PETER SMITH)
Royal Courts of Justice
Strand
London, WC2
MR R STEWART QC (instructed by Messrs Barlow Lyde & Gilbert, London, EC3A 7NJ) appeared on behalf of the Appellant.
THE RESPONDENTS DID NOT APPEAR AND WERE NOT REPRESENTED.
This is an application by the second and eighth defendants for permission to appeal against Peter Smith J's refusal to eliminate them now from a pending action by the state of Zambia against 20 defendants who are alleged to have been party in one degree or another to two major conspiracies by which the country's former President is said to have misappropriated huge amounts of the country's money. The second defendant is the practice in which the eighth defendant, a solicitor, is a sole practitioner. The sum, approaching US5 million, which passed through his client account is said to have been part of the sums looted in the course of the two conspiracies. The case against him is that he was both a knowing receiver of that sum and was complicit in the conspiracies to steal it. It is also alleged that the defendant (I say defendant because it is in reality one individual I am concerned with) was guilty of knowing assistance, a case which his counsel, Mr Roger Stewart QC, accepts is tenable on the pleadings and which he is prepared to meet.
The case is now for trial at the end of October in this country, moving to Zambia in November to take evidence from a variety of witnesses. Earlier this week there was a case management conference, as a result of which witness statements are to be exchanged by 25 August. Further documents, however, will not be exchanged until the end of September.
On 22 May this year Peter Smith J handed down a judgment based on written submissions, because the oral hearing had had to be vacated for want of time, refusing this defendant's application to halt the proceedings against him for deficiency of pleading and allowing the claimant to re-re-amend his particulars of claim. Refusing permission to appeal, the judge wrote that this was a case management matter and that the defendants:
"… were given an opportunity to review the matter at the close of evidence at the next CMC".
Mr Roger Stewart submits that this was temporising with what was a clear case for putting an end to an insufficiently substantiated claim against his client. He submits in particular that the judge showed that he was doing this when he said at paragraph 19(1):
"As DLA say in their response (their letter paragraph 36) the purpose of the amendment was to clarify the nature of the conspiracy. There is as BLG say an overarching conspiracy but it is not a conspiracy which provides anybody who is a party to any laundering of Zambian government money. It is only those who participate in the conspiracy identified in paragraph 1095 which is a conspiracy which starts on 30 th August 1999 with an agreement that the parties to it by unlawful means are conspiring to defraud the Claimant by misappropriation of monies belonging to it and to conceal such fraud. That fraud is perpetrated by various transactions which are subsequently identified. I see no difficulty about that as a plea. I accept that it will involve CM and BT dealing extensively with the entirety of the allegations under this part of the re re re-amended Particulars of Claim but so be it. The Claimants assume the burden for that and it seems to me it can only really be further considered when the Defendants have pleaded, led their evidence and the matter goes to trial or is reviewed before trial It would be quite wrong to take a pre-emptive decision at this stage in a case like this with its complexity, multiple Defendants and large dealings of money which require explanation. Given the nature of the transactions the Claimants face difficulty without seeing what the Defendants say was the purpose of the transactions. That is why I ordered the Scott Schedule.
I do not see that these Defendants face an embarrassing or meaningless pleading. It is wide ranging but it does not mean they cannot meet it. If at the end of the trial the claim against them is not established then they have the protection of orders for security for costs. If on the other hand these allegations are struck out and the evidence that arrives at trial shows that it was wrong to strike them out it will be virtually impossible to reinstate the allegations against them at that late stage.
The essence of the allegation of participation in the conspiracy is in form 135–1138. The Claimants are seeking to persuade the court to infer that these (and other Defendants) were party to the conspiracy because of the nature of the transactions and their lack of response to them in any proper way.
I see no difficulty about this. The Claimants cannot establish a positive case at the moment although they may presumably change that in the light of the positive case (if any) provided by the Defendants to the various Scott Schedules."
The judge also said at paragraph 19(4):
"I accept that the Claimants have not yet advanced a clear case for knowing receipt. DLA's answer is a reference to paragraph 92. However it seems to me that sooner or later the Claimants must in respect of all the payments in the light of the answers to the Scott Schedules identify which payments they assert they have a claim for knowing receipt as opposed to knowing assistance. I agree with BLG's contention that at the moment it is not satisfactory but it seems to me that I should not strike it out in advance of seeing what these Defendants say. I will give these Defendants an opportunity after close of pleadings to raise this matter further."
It is Mr Stewart's case that if no sufficient claim against his client has by now been put on paper, he is entitled to be released from the stress and anxiety of this potentially ruinous litigation. In particular, Mr Stewart has submitted this morning that when the judge says that "no positive case" has been pleaded, there can in law be no alternative but to strike out the material pleading, especially given the physical deletion from paragraph 1095 of the particulars of claim of such details as had initially been included in it.
Although the judge ran through the many heads of complaint contained in Barlow Lyde & Gilbert's letter sent on the defendant's behalf of 12 April 2006, only four in fact have been pressed in the skeleton argument. Today's focus is on the first two, the pleading (such as it was) of a dual conspiracy and the pleading of knowing receipt on the solicitor's part.
Mr Stewart in his excellent skeleton argument has set out a helpful conspectus of the law of civil conspiracy. It includes the proposition that there must at least be evidence from which a court could legitimately infer that the defendant must have known, to put it crudely, that he was involved in a scam. He submits that the continued failure of the claimant to particularise the case for inferring such knowledge on the solicitor's part renders the pleading demurrable.
The case against this defendant is summarised very fairly by Mr Stewart in paragraph 15 of his skeleton argument in this way:
"a) It is C's [the Claimant's] belief that 2D/8D acted in two distinct, but somewhat amorphous, conspiracies to steal monies from Zambia; b) a modest proportion of the monies misappropriated in those conspiracies passed through D2's account; and c) the explanations from D2/D8 as to the reasons for handling those monies are inadequate and suggestive of dishonesty."
But this, submits Mr Stewart, amounts to no more than a Micawberesque endeavour to see what if anything turns up at trial to implicate the solicitor. The judge did not agree with this. Mr Stewart directs his attack upon the judge's view at paragraph 19(1) and 19(4), which I have quoted, arguing that the pleading was indeed embarrassing and meaningless; that the fact (which the judge accepted) that the claimant could not for the present establish a positive case was in law fatal to the claim; that it was not enough to show that the solicitor had no convincing explanation for the £5 million-odd in his account; that the judge should not have allowed an amendment to remove a plainly unsustainable allegation against him; and in sum that the judge took a temporising approach to see if the claimant could patch up his case against the solicitor before it was too late.
As to knowing receipt, the claimant had admitted being unable to say whether the money had been received by the solicitor for his own benefit, and on this alone, Mr Stewart submits, the knowing receipt case had to founder.
Looking at the last point first, the basis of Mr Stewart's submission is the proposition of law that there is no knowing receipt of monies in a merely ministerial capacity. That ex concessis may have been the case here, but the conspiracy case, if it were to stand up, will negative a merely ministerial function, and I am not prepared to accept that in this event more would have to be established by way of personal benefit in order to prove knowing receipt; there would be enough to be tried, in other words.
The judge accepted that the pleading of knowing receipt did not yet constitute a clear case but he considered that, given the fact of receipt, it was proper to wait and see what the solicitor said about it before deciding...
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